Dec 4, 2012

Five rice exporting nations within the ASEAN bloc might be organised into a cartel with the aim of boosting prices by 10 percent, as well as lifting quality control, a Myanmar Rice Federation official said last week.

Dr Soe Tun, an MRF central executive committee member, told The Myanmar Times that President U Thein Sein had urged the federation to support the initiative, which would group Thailand, Vietnam, Laos, Cambodia and Myanmar together as one exporter.

He added that the preparatory framework for the cartel could be finished by the end of the year.

However, the Bangkok Post reported on Sunday, November 18 that the initiative had stalled because some of the nations were not ready to institutionalise cooperation in the industry.

Thailand initiated the proposal to form the cartel in August, with Laos, Myanmar, Vietnam and Cambodia agreeing to consider the idea, which would be backed by the creation of an ASEAN Rice Federation to help move the idea forward.

However, the Bangkok Post said the plan had drawn criticism from the Asian Development Bank, which labelled it globally irresponsible.

The Post reported that after talks with his Lao, Myanmar, Thai and Vietnamese counterparts on Saturday, November 17, Cambodia’s Minister of Commerce Cham Praseth said formal cooperation between the five countries had been shelved because several countries were not ready.

He said the countries would instead focus on what could be done within the region to improve rice production standards.

But Dr Soe Tun said Myanmar stood ready to back the plan.

“Our president is really willing to organise and cooperate with other countries to promote the agricultural sector,” he said. “So far Thailand is leading the way to organise the ASEAN 5-E group. We are focusing on the export sector.

“This organisation will mainly work on two items: to boost the quality of rice exports and increase prices,” Dr Soe Tun said.

“We discussed the formation of an organisation in Thailand on October 25 and some fundamental agreements and standards came out from that meeting,” he said.

ASEAN 5-E will also work together to set minimum quality standards for exports and to set prices, in much the same was that the Organisation of the Petroleum Exporting Countries does.

However, Dr Soe Tun said some of the nations that might join the bloc need to upgrade their rice production systems.

“In some agreements, we are concern about the weaknesses of some countries [Myanmar, Laos and Cambodia] because farmers in these countries don’t have the techniques and access to high-quality seeds that would allow them to export at a high standard.